Environmental & Waste · Recycling infrastructure

What a recycling MRF earns — gate fee plus commodities

A materials recovery facility (MRF) is paid a gate fee to take mixed recyclables, mechanically sorts them into paper, plastics, metals and glass, and sells the baled recyclate as commodities. The gate-fee leg is a contracted annuity; the commodity leg is highly volatile — recyclate prices swing with global markets — and a slice of the input is residue that costs money to dispose of. The case turns on throughput, the gate fee, and where recyclate prices land.

200
£55
£95
LIVE
Gate fee paid per tonne of recyclables in Sorting line screens, magnets & optical sorters Recyclate sales baled commodities sold Operating cost sorting O&M, residue disposal
Flows — annualised from current assumptionsper year
Revenue p.a.
£0
£0 / hr
EBITDA p.a.
£0
0% margin
Revenue / tonne
£0
gate + recyclate
Throughput
0
90% recovered
Stocks — what the flows accumulate intolive
Recyclate baled · session
0
tonnes sold to market
EBITDA banked · session
£0
accumulating in real time
Implied enterprise value
£0
at 10× EBITDA
Where revenue comes from Total £0 p.a.
Gate fees
Recyclate sales
Why investors are wary of pure MRFs: the gate fee is a stable, often contracted annuity, but the recyclate leg is exposed to volatile global commodity prices — when paper, plastic and metal prices fall, a thin-margin sorter can swing to losses, so the best assets lock in long council contracts with price-share or floor mechanisms. The structural tailwind is policy: higher recycling targets, packaging-producer responsibility and quality standards drive volumes and reward well-sorted, low-contamination output.
Revenue streams£0 p.a.
Operating costs£0 p.a.
Investment case — should you buy it?DCF returns

Year-1 financials flow live from the simulation above: revenue £0 and EBITDA £0 p.a. Set your deal terms below — the unlevered IRR (asset return) and levered IRR (return to equity, after debt) recompute instantly.

Operating

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%
%
%
%
%

Valuation & hold

×
×
y

Financing

×
%
%
Unlevered IRR
—
asset / project return
Levered IRR
—
return to equity
Equity multiple
—
MOIC over hold
Equity gain
—
exit equity − invested
Equity cash-flow profile£m · ■ invested   ■ returned
Projection — £m per year

Illustrative model. Represents a materials recovery facility (MRF). Revenue = gate fees (tonnes in × gate fee) + recyclate sales (recovered tonnes × commodity price) + a higher-value metals fraction. Operating costs (sorting & operations and residue disposal per tonne, fixed labour and insurance, a maintenance reserve) leave a thin margin that is highly sensitive to commodity prices — at low recyclate prices the plant can run at a loss (the model then shows it is too thin to value). EBITDA = revenue − operating costs; excludes upfront construction capex. The investment case is a simplified DCF. For illustration only — not investment advice, and not any specific asset.